UAC Plc has released its half-year earnings report for 2023, marking a remarkable transformation in its financial performance.
The company recorded a significant pre-tax profit of N4 billion compared to a pre-tax loss of N966 million in the same period last year.
The second quarter played a crucial role in bolstering the overall profitability, contributing to a total pre-tax profit of N3.1 billion in the first half of the year.
Key highlights for the Second Quarter of 2023:
- Revenue surged to N28.2 billion, indicating a remarkable growth of 15.9% Year-on-Year (YoY).
- Operating profit improved significantly, reaching N665 million, a noteworthy improvement compared to the negative N257 million reported YoY.
- Net Finance Income showed a substantial improvement, reaching N2.9 billion, in stark contrast to the negative N630 million reported YoY.
- Earnings per share made an impressive turnaround, reaching 83 kobo, compared to a loss of 46 kobo reported YoY.
- Gross Margin increased to 18.9%, showing an improvement from 15.8% YoY.
- Operating expenses as a percentage of Gross Profit decreased to 87.5%, reflecting an improvement from the high 106.5% reported YoY.
- Total debt remained unchanged from the previous quarter, standing at N18 billion.
- Cash and cash equivalents amounted to N14.9 billion.
Insights from the report indicate that UAC’s improved performance was largely attributed to a boost in finance income, which significantly contributed to the overall profitability. Notably, the company reported a substantial exchange rate gain of N3.5 billion during the quarter, which played a crucial role in achieving profitability.
However, it is worth noting that when adjusted for the exchange rate gain, the company’s result would have swung into losses. Thus, the finance income played a pivotal role in turning the tide in UAC’s favor.
Segment reporting indicated mixed results, with the QSR (Quick Service Restaurant), Animal feeds, and Other edibles businesses reporting an operating loss. On the other hand, the pain business, packaged foods, and beverages businesses posted profits.
Overall, UAC Plc’s H1 2023 performance showcases a significant turnaround, primarily driven by improved finance income. The company’s strategic focus on profitable segments has contributed to its impressive results, instilling confidence in its future prospects.
